S&P Global has projected an annual average growth rate of 6.7% from the fiscal year 2023-24 (FY24) to FY31, highlighting the role of capital accumulation as the primary catalyst for this expansion. This outlook reflects a strong belief in the Indian economy’s potential for medium-term growth.
In a report titled ‘Look Forward: India’s Moment’, S&P’s forecast indicates that India’s gross domestic product (GDP) is poised to nearly double to US$ 6.7 trillion by FY31 from its current US$ 3.4 trillion in FY23. This development corresponds to a per capita GDP of approximately US$ 4,500.
Similarly, Standard Chartered Bank has made a comparable prediction, foreseeing India’s GDP nearly tripling to US$ 6 trillion by the conclusion of FY30. The bank’s prognosis attributes this surge to domestic expenditure and international trade, driving a nearly 70% increase in per capita income to US$ 4,000 from the present US$ 2,450 during that period.
Despite potential obstacles such as a projected slowdown to 6% in FY24 due to global economic challenges and the delayed effects of Reserve Bank of India (RBI) policy decisions, S&P’s assessment asserts that India will maintain its position as the G20’s fastest-growing economy.
Mr. V Anantha Nageswaran, Chief Economic Advisor, highlighted the manufacturing sector’s significance and stressed the necessity of transitioning toward high-value-added services in an interview included in the report. This strategic shift is deemed crucial to sustaining a growth rate ranging from 7% to 7.5% until 2030. Nageswaran also enumerated India’s competitive strengths, encompassing skilled labor, enhanced physical infrastructure, a robust industrial ecosystem, and a substantial domestic market.
